Melbourne auctions: First-home buyers send Northcote apartment soaring $87,500 above reserve

Five first-home buyers fought it out for a two-bedroom apartment in a top Northcote location, sending the price nearly $90,000 above the reserve.

The bright ground floor unit came with its own courtyard, right near the shops and cafes of High Street, drawing a crowd of about three dozen onlookers.

It was one of 636 properties taken to auction in Melbourne on Saturday.

By evening, Domain Group had recorded a 64.3 per cent clearance rate from 422 reported results.

Across the city, agents hailed a lift in sentiment in the fortnight since the election and a proposal from the bank regulator to loosen lending standards.

But its effect on auction floors has been muted so far, with buyers elsewhere still letting homes pass in and negotiating after.

Bidding was spirited for the unit at 1/30 Mitchell Street, kicking off at $480,000.

It rose in a series of $10,000 and $5000 increments before narrowing to a tight two-party race towards the end.

The home sold under the hammer for $617,500, well above its reserve price of $530,000.

It had been listed with a price guide of $520,000 to $570,000.

Underbidder John, who declined to give his last name and was bidding on behalf of his daughter, was dismayed.

“The price range was $520,000 to $570,000 and it went [nearly] $50,000 above that,” he said.

The winning party was a first-home buyer couple, who had a friend bidding on their behalf.

No investors participated, Barry Plant Inner North director Loretta Khoo said, adding that an increased willingness from banks to lend was helping the market.

“It went well above what our expectation was going to be,” she said.

“The lending has been a little bit quicker from banks … [which are] probably not as strict with regards to their processes.”

Vendors Julie and Harry Zafer, who are based in Perth, had bought the home for their daughter to use while studying in Melbourne, then later rented it out.

“We are getting older and decided we want to get rid of a few responsibilities,” Julie said. Harry added that the election result had boosted confidence before the sale. “The sun is shining on the Melbourne market,” he said.

Earlier nearby, a one-bedroom unit passed in after a slow start.

The home at 3/175 Gladstone Avenue, Northcote, drew an opening bid of $320,000 but looked set to stall just one bid later.

After a pause for instructions, three parties offered a spate of quick bids, taking the level to $370,000, where it passed in.

The home sold afterwards for $385,000, with a first home buyer beating out two investors, McGrath Northcote’s Luke Brizzi said. It had been listed with a price guide of $350,000 to $370,000.

Even so, he hailed a post-election shift in sentiment. “It may get stronger quicker than we think,” he said.

The property last changed hands for $262,500 in 2008, records show.

In Hawthorn East, a two-bedroom unit sold to an investor for $480,000.

The home at 5/20 Victoria Grove drew a crowd of about 35 to 40, with three parties pushing the price to the top of its quoted range of $450,000 to $480,000.

“Having an investor buy it gives you a bit of confidence out there,” Jellis Craig’s Chris Hingston said, tipping more investors to return to the market post-election.

In Frankston, a four-bedroom house on a 703 square metre block passed in after a lengthy auction, Ray White Frankston’s Callum MacPherson said.

But two bidders pushed the price for 6 Justin Court  to only $690,000, at the lower end of its quoted range of $685,000 to $750,000.

Some buyers are nervous about the auction process or still don’t have their finances in order, he said.

“There are some buyers that won’t bid at auction,” he said.

“We are very confident and expect it to be probably sold by the middle of the week at the latest.”

In Brunswick East, a two-bedroom townhouse sold in the middle of its range after drawing four bidders.

The home at 222 Edward Street had been listed with hopes of $700,000 to $770,000 and attracted three first-home buyers and one investor.

It sold under the hammer for $755,000 to a first-time buyer who had been in the market for a couple of months, Biggin & Scott’s Andrew Crotty said.

He has noticed positive talk from buyers after the election and has seen hits on online listings nearly double since the poll. Combined with a possible upcoming rate cut and the prospect of easier bank lending, this would be a “perfect storm” for the market, he said.

In Richmond, a one-bedroom apartment in an older-style block sold under the hammer after only one bid.

The unit at 6/9 Goodwood Street was close to trams, shops and the CBD and had expectations of $360,000 to $390,000.

A first-home buyer made an offer at $370,000, which was around the vendor’s reserve, Little Real Estate’s Shawn White said.

A two-bedroom apartment in Brunswick West passed in but sold through negotiations immediately after for $420,000.

Alexkarbon’s Charles Bongiovanni said a first-home buyer snapped up the property at 4/21 Everett Street which was being sold by a vendor who had bought it for her own first home.

Another apartment in Thornbury passed in after one of the interested parties bought another home that same morning.

The two-bedroom unit at 10/10 Dundas Street reached $410,000 at auction, shy of its $430,000 reserve, Love & Co’s Theo Angelopoulos said.